India's largest microfinance company Bandhan Financial Services Ltd. (BFSL) on Wednesday received the final nod from the Reserve Bank of India (RBI) to set up a universal bank.
BFSL, presently a non-banking financial company (NBFC), is scheduled to kick-start its banking operations on August 23 this year in Kolkata.
"Our plan is to open around 500-600 branches across India with a special focus on the east and north-eastern parts of the country. We will be a bank for all, but our primary objective will be to serve the unbanked," the company's director Chandra Shekhar Ghosh said.
It has recently completed raising Rs.1,020 crore equity from the International Finance Corporation, Singapore's sovereign wealth fund GIC and the state-run Small Industries Development Bank of India, after which its net worth has gone up to Rs.2,700 crore.
The RBI had stipulated a minimum capital base of Rs.500 crore for new banks.
Its loan book stands at Rs.10,000 crore.
BFSL has appointed 850 experienced banking professionals at senior and middle-level positions to run its operations in addition to the 17,000 employees that the microfinance entity already has.
"The bank will specially cater to the need of micro, small and medium enterprise (MSME) and small and medium enterprise (SME) units. We have adequate capital and solid risk management system in place and we will serve everyone with utmost honesty and the highest ethics," he said.
After receiving the in-principle license from the country's apex bank in April last year, the company had been working towards transforming itself into a bank -- a task for which it appointed five specialised agencies.
Deloitte Touche Tohmatsu India Pvt. Ltd. was selected as the consultant for the banking project while FIS was selected as the information technology partner.
Aon Hewitt was assigned to design the human resources and compensation policy for employees, Madison Media handled the advertising needs and Ogilvy & Mather was appointed to handle the brand-building exercise.
BFSL made a humble beginning in 2001 with the idea of "making a significant contribution towards poverty alleviation by empowering women".
It is presently registered as a non-banking finance company with RBI and has operations in 22 states with a network of 2,022 branches.